US-based National General Holdings (NGHC) has entered into an agreement with QBE North America to purchase its Lender-Placed Insurance (LPI) business, for around $90m.
Under the deal, National General will acquire certain assets, including loan-tracking systems and technology, client servicing accounts, intellectual property, and vendor relationships.
National General will also assume all related insurance liabilities in a reinsurance transaction through which it will receive the loss reserves, unearned premium reserves and invested assets at closing and these amounts were about $92m, $247m and $342m, as of 30 June.
National General chairman and CEO Michael Karfunkel Michael Karfunkel said: "This acquisition facilitates National General’s entry into the lender-placed insurance segment for auto and homeowners risks with an industry leading platform and management team.
"While the lender-placed business has had difficulties in the past, we believe it is now an area of great opportunity after numerous changes that have been enacted throughout the industry."
QBE LPI provides full suite of lender-placed insurance products to customers through three business segments, including LPI Home, LPI Auto and Seattle Specialty Insurance Services.
LPI Home provides fire, home, and flood products, while LPI Auto offers collateral protection insurance and guaranteed asset protection products for automobiles, and Seattle Specialty Insurance Services is an agency and tracking business that focuses on the smaller niche loan servicing market.
Subject to customary closing conditions and regulatory approvals, the deal is expected to complete within 90 days.
National General offers personal and commercial automobile, homeowners, umbrella, recreational vehicle, motorcycle, supplemental health, and other niche insurance products.
Image: National General to acquire QBE North America’s Lender-Placed Insurance business. Photo: courtesy of Stuart Miles/ FreeDigitalPhotos.net.